Justia Government & Administrative Law Opinion Summaries

Vicksburg Chemical Company (VCC) filed for bankruptcy in 2002. Included in its bankruptcy estate was over 500 acres of real property, a portion of which was contaminated. Pursuant to an agreed order, the bankruptcy court allowed VCC to abandon the property and allowed the Mississippi Department of Environmental Quality (MDEQ) to choose the purchaser. Without the aid of any guidelines or statutory law regarding this process, MDEQ, at the suggestion of the Attorney General's Office (AG), published a Request for Proposals (RFP) to identify interested parties capable of removing the contamination. The plaintiff, Pacific Chlorine, Inc. (PCI), was one of several companies to submit a proposal. MDEQ did not select PCI's proposal, but instead selected Harcros Chemicals, Inc. (Harcros), a company which worked closely with the City of Vicksburg (the City) on its proposal. Aggrieved, PCI sued MDEQ and the City. PCI settled with the City. Following a bench trial, the trial court rendered a judgment against MDEQ. MDEQ appealed to the Supreme Court, raising six assignments of error that fall into three categories: whether PCI is required to exhaust its administrative remedies, whether the trial court erred by denying MDEQ's motion to dismiss/motion for summary judgment, and whether MDEQ is immune from suit under the Mississippi Tort Claims Act (MTCA). This case presented an issue of first impression, the issue being whether MDEQ acted within the scope of its authority when assisting a bankruptcy court with finding a purchaser for contaminated land. The Court found that it was. View "Mississippi Department of Environmental Quality v. Pacific Chlorine, Inc." on Justia Law

In late 2008, Lou Ann Cassell inherited $220,000 from her aunt. At that time, both Cassell and her wholly owned company, J&L Arborists, LLC, were insolvent. After consulting with attorneys and accountants, she used her $220,000 inheritance to purchase a single-premium fixed annuity. She began receiving monthly payments, and under the annuity contract she is scheduled to receive those payments for the rest of her life. The contract also guarantees the payments for ten years regardless of when Cassell dies. She designated her children as the beneficiaries of the payments if she dies within the ten-year guarantee period. A year after she had purchased the annuity, Cassell and her company filed a Chapter 7 bankruptcy petition. She included the annuity as an asset in her Schedule B disclosures, and listed it as exempt under Georgia law on Schedule C. The trustee objected, contending that Cassell's annuity is nonexempt because it does not meet the requirements of the statute. The bankruptcy court held that Cassell's annuity was an "annuity" within the meaning of the Georgia bankruptcy exemption statute. The district court affirmed as to the issues that the bankruptcy court had addressed but remanded the case, leaving it for the bankruptcy court to decide in the first instance whether the annuity payments were reasonably necessary for Cassell's support. Upon review, the Eleventh Circuit certified the question pertaining to the Georgia exemption to the Georgia Supreme Court.

As one of the largest developers in Cincinnati, Erpenbeck defrauded buyers and banks out of nearly $34 million. Erpenbeck pled guilty to bank-fraud in 2003, received a 300-month sentence, and was ordered to forfeit proceeds: $33,935,878.02, 18 U.S.C. 982(a). The FBI later learned that Erpenbeck had given a friend more than $250,000 in cash. The friend put the cash in a cooler and buried it on a golf course. Agents unearthed the cooler. The government sought forfeiture of the cash and posted online notice in 2009. Three months later, the trustee of Erpenbeck’s bankruptcy estate contacted an Assistant U.S. Attorney, told her the estate had an interest in the cash and asked about the government's plans. The attorney did not mention the forfeiture proceedings. Because no one asserted an interest, the district court entered an order vesting title to the cash in the government, 21 U.S.C. 853(n)(7). The trustee sought to stay the order in November 2010. The district court denied the motion because the trustee did not file a timely petition. The Sixth Circuit vacated. Even though the trustee’s interest in the cash was "far from a mystery," the government did not take even the "modest step" of sending a certified letter.

Plaintiff, the Chapter 7 trustee for the bankruptcy estate of BioniCare Medical Technologies, contested determinations of the Medicare Appeals Council (MAC) refusing to provide coverage for the BIO-1000, a device to treat osteoarthritis of the knee. Plaintiff alleged that the Secretary improperly used the adjudicative process to create a policy of denying coverage for the BIO-1000, that the MAC's decisions were not supported by substantial evidence, and that the MAC's decisions were arbitrary and capricious on account of a variety of procedural errors. The court rejected those contentions and affirmed the judgment of the district court.

The U.S. District Court for the Southern District of Alabama, Southern Division certified a question to the Supreme Court: whether Ala. Code 11-81-3 (1975) required that an Alabama municipality refund or fund bond indebtedness as a condition of eligibility to proceed under Chapter 9 of Title 11 of the U.S. Code. Upon review, the Alabama Supreme Court concluded that the legislature intended to authorize every county, city, town and municipal authority to file for Chapter 9, and therefore, they are not required to have indebtedness prior to filing for Chapter 9 protection.

This case was related to certain documents produced in discovery and filed in the bankruptcy court, containing allegations that Father M and D, two priests who were not parties to the Portland Archdiocese's bankruptcy case, had sexually abused children. The bankruptcy court held that the discovery documents at issue could be disclosed to the public, because the public's interest in disclosure of these discovery documents outweighed the priests' privacy interest under Rule 26(c) and that the documents filed in court could be disclosed because they did not contain "scandalous" allegations for purposes of 11 U.S.C. 107(b). The court affirmed the bankruptcy court's ruling as to the release of discovery documents disclosing Father M's name under Rule 26(c), because the public's serious safety concerns could not be addressed if Father M's name was redacted. But because the record did not reflect the existence of any similar significant public interest that required the disclosure of Father D's name, the court held that Father D's name must be redacted from any discovery documents that were released. Finally, because of the mandatory duty to keep scandalous material confidential at the request of a party under section 107(b), the court reversed the decision to release the punitive damages memorandum and attached documents.

The primary issue in this Chapter 7 bankruptcy case was whether the United States Bankruptcy Appellate Panel for the Tenth Circuit had jurisdiction to review on "order for relief" entered by a bankruptcy judge for the District of Delaware. The Delaware judge entered the order after venue was transferred to the District of Colorado. The parties agreed that the order should be vacated on the ground that it is void because it was issued after the transfer was complete. However, the Tenth Circuit Bankruptcy Appellate Panel concluded that it did not have jurisdiction because the governing statute provides that an appeal of a decision by a bankruptcy judge "shall only be taken only to the district court for the judicial district in which the bankruptcy judge is serving." Upon review, the Tenth Circuit Court of Appeals agreed with the Tenth Circuit Bankruptcy Appellate Panel and affirmed its decision.

The Florida Department of Revenue (Florida DOR) and the Virginia Department of Social Services (Virginia DSS) appealed the district court's decision affirming an order of the bankruptcy court holding the agencies in contempt and awarding debtor compensatory and punitive damages for the agencies' alleged violations of the automatic stay and discharge injunction issued by the bankruptcy court. The court held that state sovereign immunity shields the the Florida DOR and the Virginia DSS from debtor's claims for violations of the automatic stay. The court also held that, although sovereign immunity did not bar debtor's claims for violations of the discharge injunction, neither the Florida DOR nor the Virginia DSS violated the discharge injunction. Accordingly, the court reversed the judgment of the district court and remanded with instructions to vacate the bankruptcy court's order and dismiss the action.

Plaintiff-Appellant Lesa Kensmoe appealed a district court order granting F/S Manufacturing a renewal by affidavit of its 1998 judgment against her. In 1998, F/S Manufacturing obtained a default judgment in the amount of $450,894.78 against Appellant. In 2008, F/S Manufacturing's judgment against Plaintiff was cancelled of record. On March 8, 2010, almost two years after the 1998 judgment was cancelled, F/S Manufacturing filed an affidavit attempting to renew the judgment. After being informed the judgment could not be renewed because it had expired, F/S Manufacturing filed a motion requesting that the district court order the clerk of court to renew the judgment by affidavit. Upon review of the applicable legal authority, the Supreme Court reversed the district court's order, finding that North Dakota law did not permit a cancelled judgment's renewal after the prescribed statute of limitations.

"The Dawses' struggle with the IRS has a lengthy provenance." Decades ago, Donald and Phyllis Dawes pled guilty for failing to file their 1981 through 1983 tax returns. They also failed to pay their taxes from 1986 through 1988, and 1990. All this led to the IRS to seek and win a declaratory judgment that the Dawses fraudulently conveyed certain assets in an effort to avoid their creditors and that those conveyances were null and void. The IRS proceeded to execute this judgment to take possession of these assets, but before it could do so, the Dawses filed for Chapter 12 bankruptcy protection. "And that brings us to the latest installment of this epic": with permission of the bankruptcy court, the Dawses sold several tracts of land. The sale created income tax liabilities. The Dawses submitted a bankruptcy reorganization plan in which they proposed to treat their newly incurred tax liabilities as general unsecured claims. The IRS opposed the plan "vigorously" but was unsuccessful at the bankruptcy and federal district court. The IRS brought its complaint to the Tenth Circuit, asking to "undo its earlier losses." Upon careful consideration of the lengthy record below, the Tenth Circuit found that the taxes at issue here were incurred by the Dawses after they petitioned for bankruptcy. "So it is that the Dawses must pay the tax collector his due." The post-petition income tax liabilities at issue were not eligible for treatment as unsecured claims under the Bankruptcy Code. The Tenth Circuit reversed the lower courtsâ decisions and remanded the case for further proceedings.